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10/27/2010
04:51 AM
Bob Evans
Bob Evans
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Global CIO: In Larry Ellison's Legal Battle With SAP, HP Is Collateral Damage

Ellison says Oracle will compel new HP CEO Apotheker to testify about what he knew during his SAP tenure—unless HP's board keeps him "far, far away."

"Unless, Mr. Lane and the rest of the HP Board of Directors decide to keep their new CEO far, far away from HP Headquarters until that trial is over. If HP keeps Leo Apotheker far from HP headquarters we cannot subpoena him to testify at that trial," Ellison's statement said.

"I don't think Ray Lane wants to risk Leo Apotheker testifying under oath as to why he allowed the theft of Oracle's property to continue for 8 months after he was made sole CEO of SAP. I hope I'm wrong, but my guess is that new HP's Chairman, Mr. Lane, will keep HP's new CEO, Mr. Apotheker, far, far away from the Courthouse until this trial is over."

Well well. This certainly raises a few questions:

1) Clearly, HP's board knew about this trial, and they had to know Apotheker was at SAP during the time the illegal downloading occurred, and they had to know the trial was due to start Nov. 1, and they really had to know that Ellison would zero in on Apotheker as a primary witness. Yet, the HP board went ahead and hired Apotheker anyway, and had his employment begin on the exact same day as the trial. So here's the question: how does HP explain this rather complicated Nov. 1 coincidence? Either it was aware of it and said what the heck; or, it was unaware of it, which would not reflect terribly well on the board.

2) Ellison's statement says that Oracle intends to show during the trial that Apotheker, during his time at SAP, was at least aware of the software theft. If he testifies, how distracting will that involvement be for HP, a company that will have been without a CEO for almost three months by the time the trial begins?

3) If Apotheker doesn't testify, that'll probably be only because he's outside the reach of U.S. law, which would probably mean he'd have to be outside the U.S. Now, while it's true that HP is not only the world's largest IT company but also as global as you can get—doing business in almost 200 countries and deriving about 65% of its revenue from outside the U.S.—is it feasible for HP to have a CEO who avoids the U.S.?

Hey, I'm no Perry Mason or Judge Judy, but it seems inconceivable to me that HP will try to avoid having Apotheker testify by keeping him "far, far away."

It further seems to me that HP wouldn't have hired Apotheker unless it knew with 100% certainty that his testimony—while unwelcome and potentially embarrassing for HP—will all be over in a relatively short time and Apotheker can then devote full time to running HP.

The only alternative explanation is that the HP board, before hiring Apotheker, did not fully think through the implications of his inevitable involvement in this trial—and that would be an alternative that HP shareholders would certainly want to explore in vigorous detail with the same board that decided that Apotheker was, among all the world's executives within and without HP, the very best person for that incredibly valuable job.

RECOMMENDED READING:

Global CIO: In Oracle Trial, HP Might Pay Higher Price Than SAP

Global CIO: Larry Ellison Will Be Crucial Witness At Oracle-SAP Trial

Global CIO: Larry Ellison And HP CEO: Courtroom Showdown Looming

Global CIO: An Open Letter To HP Chairman Ray Lane

Global CIO: Are HP And SAP Perfect Match Or Train Wreck?

Global CIO: An Open Letter To HP CEO Leo Apotheker

Global CIO: SAP's Sweeping Turnaround: Exclusive Co-CEO Interview

Global CIO: HP's $130-Billion Gamble

Global CIO: Larry Ellison Puts HP In Crosshairs Via Slap At New CEO

Global CIO: HP CEO Apotheker Has Deep Expertise But Checkered History

Global CIO: An Open Letter To SAP Chairman Hasso Plattner

Global CIO: SAP's Last Chance: It's The Customers, Stupid!

Global CIO: IBM Turns Guns On Cisco With Acquisition Of Blade Network

Global CIO: Oracle's Success Breeds Fear And Loathing At The New York Times

Global CIO: SAP Promises Business Value Over Products: Can It Deliver?

Global CIO: An Open Letter To HP CEO Leo Apotheker

Global CIO: SAP Stunner: ERP Deal Boosts Customer Profit $100M Per Year

GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

For more Global CIO perspectives, check out Global CIO,
or write to Bob at bevans@techweb.com.

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